JimGant

No. It's all spelled out in the Technical Explanation: https://www.irs.gov/pub/irs-trty/thaitech.pdf Article 21 is where you'll find that government pensions are taxable only by the country paying these pensions. And the TE says state and local pensions are included, not just Federal.

Has anybody done their one year report by mail? If so, can you describe the procedure -- and did you need to provide a return envelope to get your "due next year" reminder, which, I guess, doubles as a receipt of report, to staple in your passport? Thanx.

Not too hard to decipher. If you can't find your particular income as assessable in the Thai tax code, then, by default, it is NOT assessable income. And need not be reported on your Thai tax return. Income mentioned in DTAs as taxable "only in the country of residency," and you're a resident of Thailand, ipso facto, that's assessable income for Thai purposes. Other income, like rents, has a "may be taxed by country of residency," meaning, for US types, the income from your rental in the US is primarily taxed by the US; but Thailand can also tax it secondarily, but has to grant a credit for the US taxes, i.e., the country of primary taxation rights. Currently, there is no line item on Thai tax returns to list credits -- but they say they are working on it. Stay tuned.

If you remitt it in a later year than earned, Royal Decree says, essentially, that it is NOT Assessable Income. And the RD says, you don't have to file a tax return if you have no Assessable Income, or your Assessable Income is below 120000, like if you had some Thai bank interest. Ergo, no requirement to file a Thai tax return. IMO

Another source says the same thing: But, yeah, I've seen other comments to the contrary. But, all my remittances are non assessable (govt pensions, social security) -- or in one small situation, definitely remitted in a later year -- so I'm really not on top of this.

Bingo. No penalty, because the penalty is based on amount owed. And if nothing owed, no penalty. I really do think that most folks here can decipher their DTA with Thailand -- and know whether or not that they have assessable income that's reportable on a Thai tax return. And, I can't see anything about a failure to file penalty, if nothing owed. Yes, if you do owe, and you file late -- looks like a 2000 baht fine. But no fine if nothing owed, and you didn't file. And based on that, this "must file if you have 120,000 in assessable income" is nuts: That's a 380,000 baht gap before you reach the 500,000 exemption, allowance, deduction subtraction, meaning you're wasting somebody's time by having to file, when there are no taxes payable. Using the US, as representative of OECD nations, if your Adjusted Gross Income (basically, same as Thai assessable income) is less than your Standard Deduction (or itemizations), you have a negative Taxable Income -- and don't need to file for obvious reasons, at least from the revenue gathering angle. But, in the Thai situation, having a negative Taxable Income -- 380k in the above example -- you're still required to file. What a lot of paper processing with no revenue involved. Dumb. Anyway, I wouldn't file in the above situation, because there's no penalty, that I can see, since any penalty would be an assessment off taxes owed -- and there are no taxes owed. Full stop. This is the same situation in the States, where if you overwithhold, or pay extra estimated taxes -- so that you have a negative tax bill -- you don't have to file. I've already set things up for the wife, that when I croak, and since there's no way she could do taxes, or even download 1099s to give to a preparer (of which we have none in Chiang Mai), that I'll overwithhold by about $400 on all her earnings. This is what she'd pay for a tax preparer in Bangkok -- at the high end. Anyway, told her, just don't file, and the overwithholdings you forfeit will balance out with the saved preparer fee. Plus, no tax hassle headache, on top of everything else that will complicate her life. Anyway, sorry, I digress. But, I love tax puzzles.

I doubt an RD clerk will have the time or gumption to spend time giving you free tax advice. But more importantly, if foreign income is your concern, no clerk is going to have intimate knowledge of your specific DTA, as he has over 60 to consider. So, you'll be more knowledgeable about your DTA than he will. But, if you're really unsure about what's taxable, and what's not -- I'm sure you'll have a whole host of tax preparers to choose from.

Indeed. In effect, we've been grandfathered under the old rule, namely: Bring your assessable income into Thailand in the year, or years, after it is earned, and it is then not taxable. So, if that is what you have been doing, nothing has changed for you.

No!!! Nor an ethical one. [My creds? Retired CPA, formerly licensed in Virginia, USA. Expertise: Taxation and financial planning, airline aircrews. Yes, not licensed in Thailand nor an expert on expat matters -- but I would assume my background gives me a foot in the door on overall tax matters.]

My making it complicated? I'm maintaining we expats should have no problem explaining our DTAs to ourselves, and then determining, after considering the remittal aspect, what taxes I need to report on a Thai tax return, if any. You're saying, and you admit you actually did this, we should take all our numbers to an RD agent and have a meeting of minds. I'm sure I'd spend the alloted time explaining my DTA to him, since it's unlikely he's ever heard of it, or at least examined it. What's the value of this? Your research tidbits are appreciated, and I realize you've spent some time in the research. However, some of your recommendations are nonsensical.

When every farang in country has a file that delineates, and can be possessed by RD: 1. Been in country for an amalgamated number of days exceeding, or equal to, 180 2. Visa held is NOT an LTR 3. Pensions direct deposited to Thailand are NOT subject to exclusivity of home country (like, RD is going to know all the language of 60 DTAs -- yeah, right). 4. Monies wired, or ATMed, to Thailand are NOT from a bank account established, and contributed to, before Jan 1, 2024. -- This might be an argument later of how Fifo and Lifo determine that money sent is from the earliest pile, not the latest -- if post Jan 1 2024 deposits are later made. That argument is just too weird to contemplate, although it might be necessary. Anyway, just an example of the impossibility of enforcing tax compliance. Worst case: a random tax compliance audit, probably of only those with large transfers into Thailand.

Oh, come on, Mike. It's not that hard to determine what needs to be reported to RD. It's all determinable by a detailed explanation of your DTA, like with the US Technical Explanation. And, if assessable under the DTA, what about when remitted -- how hard is that? So, with such certainty, why would I want to go to RD and ask: "Sir, here is my spreadsheet on my worldwide income, with what I assume is taxable by Thailand. Do you concur?" What do you see as areas of disagreement? I just see an RD agent with caged eyeballs.

No. Mainly because Thai RD is not interested in income that isn't subject to taxation, 'cause there's no profit there, and the unnecessary filing of such a tax return has its own costs in manpower and trees. Practically, because a Thai tax return has no line items in which to place income not subject to taxation, due to nature of income (e.g., per diem); that it's excluded by DTA; that it's not remitted. Most of us can cull what's assessable and what's not. Otherwise, hire a Thai tax professional, of which, I'm sure, they'll be a lot more of soonest.

Ok, you win. If I have to file a Thai tax return, I'll include all my Air Force pensions, Social Security, and other income exempted by treaty. Now, where on the form should I put this? And after I do, where on the form would I back it out, since it's not taxable income -- which the RD would know, and wonder what kind of jerk would include it in the first place....

What I said: Does your statement mean that RD should be shown all your income in order for them to determine its assessability (taxability would be a better term)? I think you do, due to an earlier post by you (which I'll try and locate), where you state that you and the RD clerk go over all your income to determine what should be filed, and what shouldn't. I maintain that that is a step not needed, as most of us can determine whether our foreign income is subject to Thai taxation, or not. But, I guess you don't agree, which, of course, is your right.

Ok, then just say: "My social security benefit is not taxable by Thailand, due to the DTA, so it doesn't count for the income threshold for filing a tax return." Or you can say, " it isn't assessable income" if you're having a problem with "non-assessable." This thread is already the most larded discussion we've ever had on this forum; and now we're getting into a semantics "gotcha." Bizarre.

How about 100% chance? If they, or the banks, or whoever, find it impossible to parse out income remittance from capital remittances, you really think they're going to tax my 100% capital remittance to buy a condo?

Yes, gov't pensions (paid for services of past gov't employment) of most OECD countries are taxable exclusively by the country paying them. But for some countries, at least for Norway, this is not true. Norway requires (via DTA) its expats in Thailand to have their gov't pensions primarily taxable by Thailand -- thus those pensions remitted to Thailand are assessable income for Thai tax purposes. But this is not a simple credit to Norway for taxes paid to Thailand -- this is, if you have all your Norwegian pension earnings taxed by Thailand, and can show a tax return proving it -- a complete nullification of your Norway tax obligation on same pension payments. Thus, pay Thailand 1000 baht in taxes, and get relief from a Norwegian tax of 10000 baht equivalency (exaggeration, but you get the idea). Years ago, when I read this info on this forum, was the interesting part, where Norwegian expats were kicking and screaming to, first, be able to get Thai TINs -- then to declare their Norwegian pensions as taxable by the Thais. The Thai RD was throwing them out the door, saying, "We don't tax foreign pensions." Seriously. But, things did change, and if you wanted Thailand to tax your pension, I guess someone with authority decided, 'why not collect it.' Anyway, I mention this to emphasize that everyone should become familiar with their DTA with Thailand, as the new remittance rules (if implemented) will re-define assessable foreign source income.

How about a straw man that we can critique...... 1. Assessable foreign source income is PRIMARILY determined by one's DTA. Fortunately, most DTAs are fairly explicit as to which contracting country, source or residence, has primary taxing authority. -- But I use the word PRIMARILY because Thailand has its remittance clause as to taxability; so even if the DTA says it has primary taxing authority, if it is NOT remitted, it is NOT assessable income for Thai taxation purposes. 2. So, if the DTA gives Thailand primary taxing authority on certain foreign income (and under the new proposal, is earned and remitted AFTER Jan 1, 2024), then this is assessable income subject to being reported on a Thai tax return. -- But if this assessable foreign income, plus Thai based income, like the interest on your savings account, is less than 60,000 baht -- no tax filing is required. 3. Thai RD is NOT interested in non assessable income (again, income exempted by treaty, like gov't pensions for most OECD countries -- or, again, any income not remitted). Thus, if you have enough assessable income requiring you to file a Thai tax return, you would NOT include line items of non assessable income. And, for sure, if you didn't have enough assessable income to require you to file, you certainly wouldn't file a tax return containing only line items on non assessable income (or worse, line items on non income cash flow into Thailand, like savings, just to show how you're being forthcoming in reporting all your money transfers). 4. Banks aren't going to attempt to determine what part of your wire transfers into Thailand are assessable income, non assessable income, or savings. Impossible. I couldn't even tell the make up of my chunk of cash flow into Thailand, derived from a savings account containing old direct deposits of income, inheritances, new deposits of gov't pensions, i.e., non assessable via treaty, etc. How are the banks going to do this? -- And since they can't parse out income, the Thai RD isn't about to treat all cash flows into Thailand as assessable income. This will all have to come down to self assessment. --- And there are enough honest folks here that will comply, making for some new revenue, particularly as RD won't have the extra cost of hiring more folks for compliance investigations (well maybe a few, for random audits). ---- And these "honest folks", if paying tax at home on this same income, won't have a tax increase, due to the tax credit from the Thai taxation. All additions or corrections welcomed.

Yes. And they're taxable only in the contracting state of residency. What don't you understand? As I recall, you, for some reason, got hung up on the word "derived." Are you still maintaining that "derived" somehow means taxable in the contracting state where paid?

Well, they came to the right person for simple explanations. You lost my vote pages ago, when you advised to submit a tax return with all your income, not just assessable income. Then, recently, you gloat that "I submitted a return with no omissions." So, from pages ago, I remember your going through your return with the clerk, she checking off, "not taxable, not taxable, not taxable, etc" Yep, no omissions. But plenty of stupidity -- that RD office probably had plenty of laughs over the stupid farang that likes to report non assessable income.

Yes, but not much worry, in extra taxes, because, yes, Thailand will get first dibs on taxing that 10k -- but due to the saving clause in the DTA, you also have to declare that IRA distribution on your US 1040 return. And the US has to give you a dollar for dollar tax credit for what you pay Thailand in taxes. Thus, between what you pay Thailand, and what you pay the US (after the tax credit) is probably a wash. Plus, if 10k is your only assessable income for Thai tax purposes, you probably won't have any Thai taxable income, after subtracting out all the allowances, deductions, et al. Thus, your only tax bill will be with Uncle Sam, same as if you'd never left Kansas. Thus, you're treated AS IF you're a US tax resident, even tho' you're a tax resident of Thailand, not the US (are you listening, Jerry?)

Yes. But what's weird about the UK-Thai tax treaty is that private pensions aren't addressed at all, at least that I can find. And, there's not even an Article addressing "Other Income," like in the US DTA, where income not specifically addressed in Articles is discussed. So I can see why Brits scratch their heads when it comes to private pensions and Thailand. Was it intentionally left out of the treaty? And if so, then how do you know if Thailand has "assessable income" of your private pension -- or not? Maybe the answer lies in the Articles on dependent and independent employment compensation..... But, if I were a Brit, I'd sure like something definitive on private pensions remitted to Thailand.

Yes, and as a recent post shows, only assessable income is to be shown on your Thai tax return. Thus, income excluded by the DTA would not be shown -- or income not excluded by the DTA -- but not remitted in year earned -- would also not be assessable income. Thus, I would feel no lack of integrity by signing such a tax form, saying there are no omissions. Of course, under the aforementioned rules, I also would have absolutely no assessable income, thus the form I would sign would say I have no inclusions. As such, there would be no reason to submit a tax return. Thus, nothing to sign. Nevermind.

Not sure what lines you're reading between, but on Social Security, the Thai-US DTA couldn't be any clearer. The following from the Technical Explanation of that treaty, Article 20: Thailand's not about to break any tax treaty, as it gives them (in the US case) an actual advantage in what monies they have taxation rights over, like private pensions, IRAs, 401ks, annuities, et al. There are methods to tweak existing treaties. But tweaking the Social Security exclusion would make no sense -- nor would the US buy into it.